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Qualcomm Collaborates With Samsung & Sprint to Woo Customers

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Qualcomm Incorporated (QCOM - Free Report) recently announced that it has entered into separate partnerships with Samsung Electronics Co and Sprint (S - Free Report) . Its subsidiary, Qualcomm Technologies has joined forces with Samsung to unveil the Snapdragon 850 in the latter’s upcoming 2-in-1 PC. At the same time, Qualcomm has teamed up with Sprint to offer free unlimited LTE data through 2018 for PCs which use its Snapdragon 835 processor.  

The Snapdragon 850 chipset has been specifically designed for Windows 10 Always Connected PCs. It was preceded by Snapdragon 835, which was used in the first Always Connected PCs. The new processor, which assures better power efficiency, performance and connectivity, will only be available for PCs and will not be used in phones. The Snapdragon 850 can be considered to be a customized version of the Snapdragon 845, which was released for phones earlier this year. The new chipset is built on second-generation 10nm process and X20 modem. With this new platform, PCs will always stay connected to LTE or Wi-Fi, automatically synchronizing users’ data.

In order to have an optimal experience of Always Connected PCs, strong data connectivity is necessary. This is where the free unlimited data offer from telecom service provider like Sprint comes into play. The offer will be available on select devices using AutoPay. To avail this offer, one has to own or purchase HP Envy X2, ASUS NovaGo or Lenovo Miix 630. Sprint believes that with a shift in consumer preference to a mobile-first, always-on and always-connected PCs, there is a high demand for a great network experience, giving it the opportunity to deliver its services in this arena.

Relevance of the Partnering Companies in Qualcomm’s Venture

With this partnership, Samsung joins companies like Asustek Computer Inc., HP Inc. and Lenovo Group Ltd., in providing PCs running Windows, which are based on phone chips, enabling cellular network connections. Also, the unlimited data offer from the strong and reliable network connection that Sprint is known for, will enhance this platform.

Lately, Qualcomm is on a spree of building and releasing specialized chips for the Internet of Things, VR headsets and smartphone-focused wearable products, in addition to using its mobile technology for PCs.

Price Performance

Driven by these initiatives, the stock has outperformed the industry on an average in the past month with 10.7% return compared with growth of 3.6% for the latter.

Zacks Rank and Stocks to Consider

Qualcomm currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry space are BlackBerry Limited (BB - Free Report) , sporting a Zacks Rank #1 (Strong Buy), and Motorola Solutions, Inc. (MSI - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

BlackBerry has an expected long-term earnings growth rate of 18.6%.

Motorola has an expected long-term earnings growth rate of 8%.

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